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What happens when you get a basement flood?

WIlliam A. McMaster
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The weather has been in the news a lot lately. In July, 2013 in Toronto and in surrounding areas there was record rain which was beyond the capacity of the storm water management systems in many areas, resulting in surface and basement flooding and extensive damage, causing millions of dollars in insurance claims.

What are your rights as a homeowner if one of these events affects you?

Firstly, you should make sure you have insurance that covers you for sewage “backups” into your residence. Tearing out and rebuilding a finished basement including structural repair, removal of mold, etc. can be extremely costly, to say nothing of the loss of use of the area, inconvenience, etc.

Most insurance policies cover this, but exclude coverage for “surface” or “overland” water damage. In many cases the damage was caused by both at the same time, and many insurers have paid claims where this happens.

Apart from the trauma and inconvenience of a flood, what if it happens more than once and is the result of a poorly designed or maintained municipal system?

If you live in a town or city and are on a municipal water system (including sewers, water mains and storm sewers) the municipality is responsible for the design and maintenance of the system. They are responsible under the Municipal Act for “health and safety” and construction standards of infrastructure, and must maintain such infrastructure after it is built.

If a subdivision is proposed, the developer must do a detailed study of the topography, soils, water table and drainage patterns in the area and submit plans to handle water runoff, which the municipality must review and approve before a permit can be issued. There are obviously accepted engineering and design standards that should be adhered to.

Sometimes these studies are flawed and don’t consider all factors, leading to inadequate handling of water in storm events. Sometimes construction of the system is inadequate also.

The municipality should also have standards for monitoring and maintaining the system.
The systems are not designed to handle huge, rare storm events; there are predictions of these on a “100-year” basis. Most modern systems should be able to handle these, but poorly planned and constructed or older and decaying systems often cannot.

The problem is if a system is inadequate for whatever reason, floods can happen repeatedly and your quality of life, along with the value of your home, can be affected. You may even be on your own for future claims as many insurers will revoke flood coverage after one or two claims.

What can you do?

In some situations if many residents have experienced flooding, they may be able to get together and sue the municipality for a poorly designed system and lack of proper maintenance. This is a tricky question because if the system is many decades old, it may not be built to modern standards, or may be decaying. In these cases, if the municipality can show they are acting on the problem, they may not be held liable.

In some individual cases, if there is a breakdown in the system (say a blockage or break in a sewer) and the City is notified of it and they don’t take proper action, they could be liable. Usually, once the problem is fixed, there are no further consequences.

Actions like this are costly and complicated, and may involve experts in engineering, property valuation, etc., which is why many affected properties are needed to spread out the cost.

However if flooding happens repeatedly and the municipality does not take timely action, or cannot fix a problem, the damages can be significant.

There are some “immunities” available to a municipality against property owners’ lawsuits. If their system of inspection is a “policy” decision, they may be immune from action; however if the “policy” exposes people to great harm and compromises standards of health and safety, the policy itself can be attacked. If the “policy” is not carried out properly (lack of inspection and maintenance, failure to fix a systemic problem) a lawsuit can be successful.

Flooding is becoming a major concern for owners, municipalities and insurers. It is a costly problem, but public authorities have to take aggressive action to protect the people who rely on them. It remains to be seen whether they will be able to and if not, more people may have to consider their legal rights in this area.

At Singer Kwinter, we have experience in these types of claims.

The content of this article or blog posting is of a general nature and does not constitute legal advice. It is not intended to be a full or complete analysis of the topic. Before applying the concepts or any content of this article or blog it is imperative that you consult your legal advisor.

Neither the author of this article or Singer Kwinter can accept any responsibility for financial loss nor gain of any nature should the reader not take advice from their legal advisor.

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